4 Stocks Spiking on Big Volume

MADISON, Wis. ( Stockpickr) -- Professional traders running mutual funds and hedge funds don't just look at a stock's price moves; they also track big changes in volume activity. Often when above-average volume moves into an equity, it precedes a large spike in volatility.

Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst. These types of traders like to get in well before a large spike, so it's always a smart move to monitor unusual volume. That said, remember to combine trend and price action with unusual volume. Put them all together to help you decipher the next big trend for any stock.

From a technical perspective, MTRX ripped higher here right above some near-term support at $16.10 with heavy upside volume. This move is quickly pushing shares of MTRX within range of triggering a near-term breakout trade. That trade will hit if MTRX manages to take out its 52-week high at $17.93 with high volume.

Traders should now look for long-biased trades in MTRX as long as it's trending above Tuesday's low of $16.58 or above that key support area at $16.10 and then once it sustains a move or close above $17.93 with volume that hits near or above 151,838 shares. If that breakout triggers soon, then MTRX will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $20 to $23.

ViroPharma

ViroPharma ( VPHM) is dedicated to the development and commercialization of products that address serious diseases, with a focus on products used by physician specialists or in hospital settings. This stock closed up 2.3% at $27.68 on Tuesday.

Shares of VPHM were on the move Tuesday after the company said subgroup analyses of its pivotal and open label prevention trials showed effectiveness of its Cinryze in prevention of angioedema attacks in patients with hereditary angioedema poorly controlled on anabolic androgens.

From a technical perspective, VPHM trended higher here and broke out above some near-term overhead resistance levels at $27.40 to $27.46 with above-average volume. Those levels have acted as tough resistance for VPHM for over the last five months, so this breakout could be setting up VPHM for a sharp move higher.

Traders should now look for long-biased trades in VPHM as long as it's trending above $27 and then once it sustains a move or close above Tuesday's high of $28.19 with volume that hits near or above 556,850 shares. If we get that move soon, then VPHM will set up to re-test or possibly take out its next major overhead resistance levels at $30 to $31.36. Any high-volume move above $31.36 will then put $33 into range for shares of VPHM.

Puma Biotechnology

Puma Biotechnology ( PBYI) is a development-stage biopharmaceutical company that acquires and develops innovative products for the treatment of various forms of cancer. This stock closed up 2.4% at $39.33 on Tuesday.

From a technical perspective, PBYI spiked notably higher here with above-average volume. This stock has been uptrending strong for the last month, with shares soaring higher from its low of $27.40 to its recent high of $39.72. During that move, shares of PBYI have been mostly making higher lows and higher highs, which is bullish technical price action. That move is quickly pushing shares of PBYI within range of triggering a near-term breakout trade. That trade will hit if PBYI can manage to clear its all-time high at $39.72 with high volume.

Traders should now look for long-biased trades in PBYI as long as it's trending above $38 or $37 and then once it sustains a move or close above $39.72 with volume that hits near or above 145,031 shares. If we get that breakout, then PBYI will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $43 to $45.

From a technical perspective, FARO gapped higher here right above some near-term support at $36.28 with above-average volume. This stock has been uptrending strong for the last month, with shares moving higher from its low of $32.50 to its recent high of $39.07. During that move, shares of FARO have been mostly making higher lows and higher highs, which is bullish technical price action. That move has now pushed FARO within range of triggering a near-term breakout trade. That trade will hit if FARO manages to clear its 200-day at $37.74 and its 50-day at $38.34 and then once it takes out more resistance at $39.07 with high volume.

Traders should now look for long-biased trades in FARO as long as it's trending above some key near-term support at $36.28 and then once it sustains a move or close above those breakout levels with volume that hits near or above 141,039 shares. If that breakout triggers soon, then FARO will set up to re-test or possibly take out its next major overhead resistance levels at $42 to $44.

At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Madison, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.